The European Union: The Good, the Bad, and the Ugly

The Peace Project

Start with what is undeniable.

The continent that produced two world wars, the Holocaust, and centuries of imperial violence has not seen a war between its member states since the European project began. France and Germany, whose rivalry killed tens of millions, now share a currency. The borders that once required passports, checkpoints, and occasionally tanks are now crossed by 450 million people without stopping. A generation of Europeans has grown up unable to imagine fighting the country next door.

This is not a small thing. It is arguably the single greatest political achievement of the twentieth century. The European Coal and Steel Community, founded in 1951, was explicitly designed to make war between France and Germany not merely undesirable but materially impossible by pooling the resources needed to wage it. It worked. The EU's 2012 Nobel Peace Prize was mocked at the time, but the committee's reasoning was sound: over six decades, the EU and its predecessors contributed to "the advancement of peace and reconciliation, democracy and human rights in Europe."

For Ireland specifically, EU membership transformed the country. The structural and cohesion funds that flowed from Brussels from the 1970s onwards helped build motorways, modernise agriculture, and fund education. Ireland joined the EEC in 1973 as one of Western Europe's poorest countries. By the late 1990s, it was one of its richest. EU membership gave Ireland access to a market of 450 million consumers, attracted foreign direct investment on a scale that would have been impossible for a small island economy acting alone, and provided a counterweight to the dominant economic relationship with Britain that had defined Irish commerce since independence.

The single market, the freedom of movement, the Erasmus programme, the harmonisation of consumer protections, the environmental standards, the research funding, the food safety regulations, the roaming charges abolition, the GDPR - the list of concrete benefits that EU membership delivers to ordinary citizens is long and real and often taken for granted precisely because it works.

None of this is in dispute. The question is whether the EU's genuine achievements entitle it to immunity from criticism. The answer, self-evidently, is no. And the criticism is substantial.

Vote Again Until You Get It Right

Ireland is the only EU member state whose constitution requires a public referendum to ratify significant EU treaty changes. This is a consequence of a 1987 Supreme Court ruling (Crotty v. An Taoiseach) that established the principle: changes to EU treaties that transfer sovereignty require the consent of the Irish people, not just their parliament.

Every other member state ratifies EU treaties through parliamentary votes. The Irish are the only Europeans who are actually asked.

And twice, they said no.

In June 2001, Ireland held a referendum on the Treaty of Nice, which reformed EU institutions to prepare for eastward enlargement. The Irish rejected it, 53.87% to 46.13%, on a turnout of 34.79%. The result, in the words of one academic analysis, "plunged the European Union into a state of deep embarrassment." The Irish government admitted it had made a mistake by running an "excessively short campaign" and providing insufficient information. The Seville Declarations were extracted from the European Council as guarantees on Irish neutrality, and Ireland was asked to vote again in October 2002. This time, with a massive campaign by all major parties and civil society, the result was 62.89% Yes on a turnout of 49.47%.

Seven years later, it happened again. In June 2008, Ireland rejected the Treaty of Lisbon by 53.4% to 46.6%, on a turnout of 53.1%. Ireland was, once again, the only EU member state to hold a public referendum. French President Sarkozy declared the treaty "revived" after Ireland agreed to hold a second vote in exchange for guarantees on taxation, neutrality, and retaining an Irish Commissioner. In October 2009, the Irish voted Yes, 67.1% to 32.9%. Czech President Vaclav Klaus described the vote as "tarnished since this is a repeated referendum." Nigel Farage compared it to "a corrupt election in Zimbabwe."

A study by the LSE analysed the pattern across three repeat referendums (Denmark on Maastricht in 1992-3, Ireland on Nice and Lisbon) and found that Yes campaigners "learned from previous referendums and developed an approach that reframed the issue by emphasising concessions gained from the EU and the risks of rejecting a treaty for a second time." The same study noted a structural asymmetry: "while bigger member states such as France can - at least temporarily - put the brakes on the integration project when their public rejects a treaty, the smaller member states go back to their voters to persuade them in second referendums."

The RUSI put it more bluntly: "The first, and most obvious one considering Europe's history is simply to ask the Irish to vote again, until they produce the required result."

What makes this pattern so corrosive is not the outcome - both treaties were ultimately ratified with genuine concessions and higher turnouts - but the message it sends about the EU's relationship with democratic consent. When France and the Netherlands rejected the European Constitution in 2005, the entire project was shelved. The constitution was repackaged as the Lisbon Treaty and ratified by parliaments without referendums. The architect of the original Constitution, former French President Valery Giscard d'Estaing, said the quiet part aloud: the institutional reforms were "all to be found in the Treaty of Lisbon" but had been "ordered differently and split up between previous treaties" to avoid another public vote.

The EU's treaty opponents in Ireland pointed out what everyone privately acknowledged: "leading pro-treaty politicians had admitted that if referendums had been held in countries other than Ireland, it would probably have been defeated there as well."

The lesson the EU drew from these episodes was not that its treaties needed more democratic legitimacy. It was that it needed fewer referendums.

The Bailout That Saved Everyone Except Ireland

The 2008 financial crisis exposed a darker dimension of the EU's institutional machinery.

Ireland's banking sector collapsed catastrophically. The six main Irish banks had grown their international bond borrowings from less than EUR16 billion in 2003 to approximately EUR100 billion by 2007 - well over half of Ireland's GDP - by lending recklessly into a property bubble. On the night of September 29, 2008, with the banks facing insolvency, the Irish government issued a blanket guarantee covering all deposits and bonds. The total bank bailout ultimately cost EUR62.8 billion, with Anglo Irish Bank alone accounting for EUR34.7 billion.

Ireland's domestic regulatory failure was real and serious. But what happened next was determined not by Ireland but by the European Central Bank.

The IMF, brought in as part of the Troika alongside the ECB and the European Commission, favoured "burning" holders of unguaranteed, unsecured senior bonds - forcing private investors who had lent recklessly to Irish banks to share the losses. The Irish government supported this approach. The legal analysis confirmed it could be done: the former Attorney General confirmed "it depended solely on the approval of the Troika."

The ECB refused. Categorically. As the Oireachtas Banking Inquiry documented, "the ECB was very forceful" in opposing any burden-sharing with senior bondholders. The European institutions "were very concerned that moving on imposing losses on senior bondholders in Ireland would adversely affect euro area banks and their funding markets." In September 2010, EUR55 billion of bank bonds held mainly by UK, German and French banks matured and were repaid, mostly by borrowing from the ECB.

In April 2012, the 99.8% state-owned Allied Irish Banks paid EUR1.5 billion to unsecured bondholders for which neither the bank nor the Irish state had any legal liability.

The writer Gene Kerrigan summed up the popular sentiment: "It was the ECB that had put a loaded gun to the Irish government's head." He noted the ECB "conveniently forgot its own enormous failings in dealing with the crisis, as well as its responsibilities" - the same institution whose president, Jean-Claude Trichet, had in 2004 praised Ireland as "a model for the millions of new citizens of the European Union."

The ECB's concern was not Ireland. Ireland was 1% of EU GDP. The concern was contagion - the fear that if Irish bondholders took losses, investors would flee the bonds of Spanish, Italian, Portuguese, and yes, German banks. As Ireland's then-Finance Minister Michael Noonan later acknowledged, he "regretted that the ECB had directly refused any burden-sharing with holders of senior bank bonds." The EU subsequently developed bail-in rules for future banking crises. But as one analysis noted, "it was disappointing that this lesson had been drawn too late for Ireland."

As one commentator on the Irish economy website put it: "It would, of course, be far too uncouth for our European 'partners' to admit Ireland has been forced to accept a fiscally illogical deal because the EU elites are too weak to stand up to rogue German banks and anonymous bondholders."

The bailout interest rate Ireland paid was higher than Greece's. The austerity that followed lasted a decade. An entire generation of Irish people emigrated. The human cost of the EU's decision to protect bondholders at the expense of a small member state's citizens has never been properly accounted for.

The Competition Illusion

One of the EU's core principles is the promotion of competition through market liberalisation. In theory, this drives efficiency, lowers prices, and empowers consumers. In practice, in certain sectors, it has created the illusion of choice without the substance.

Ireland's electricity market is a case study. Following EU directives requiring member states to open energy markets to competition, Ireland moved from a single state-owned electricity provider (the ESB) to a deregulated retail market with multiple competing suppliers. The physical infrastructure - the grid, the power stations, the transmission network - remained essentially the same. What changed was that consumers now had a choice of which company to receive their bill from.

The Irish government's own regulator, the Commission for Regulation of Utilities, runs campaigns encouraging consumers to switch provider, telling them they could save close to EUR1,700 on electricity and EUR740 on gas bills over four years by switching to discount tariffs. In practice, only about 20% of electricity customers switch annually. The remaining 1.7 million households either do not switch or cannot be bothered to navigate the comparison process.

The result is a system where the engaged minority benefits from introductory offers while the majority - often the elderly, the less digitally literate, the time-poor - subsidise them by paying standard rates. When suppliers leave the market, as several did during the energy crisis, customers are transferred to a "supplier of last resort" at standard rates - losing whatever discount they previously had.

Meanwhile, Ireland has some of the highest electricity prices in the world, according to the International Energy Agency. The ESRI has said it cannot find an explanation for the height of energy prices in Ireland. Electricity is being sold at three times its wholesale cost. The EU's own analysis of retail energy markets found that between 2014 and 2019, Ireland's energy retailers imposed some of the highest mark-ups in the EU.

The question that deregulation proponents have never satisfactorily answered is this: if the physical infrastructure is the same, if the wholesale cost of generation is the same, if the grid that carries the electricity to your home is the same, what exactly does having ten billing companies instead of one add except marketing costs, customer acquisition costs, and the administrative overhead of constant switching?

During the energy crises triggered by Covid recovery and Russia's invasion of Ukraine, the Irish government found itself issuing energy credits to offset prices that the deregulated market was unable to control. At the time of writing, energy bills are climbing again in the wake of the Iran conflict, and the government is under pressure to reinstate credits. The deregulated market, designed to protect consumers through competition, has proved unable to protect them from the one thing that matters: the price.

Brexit and the Failure of Imagination

The EU's handling of Brexit will be studied for decades as an example of institutional inflexibility masked as principle.

The standard EU narrative is that Britain chose to leave, was offered fair terms, and suffered the predictable consequences of its own decision. There is truth in this. The Brexit campaign was riddled with misinformation, and the UK government that negotiated withdrawal was spectacularly incompetent.

But the narrative conceals a genuine failure of imagination on the EU's part - a failure rooted in the same institutional arrogance that tells small countries to vote again.

The EU's pre-referendum offer to David Cameron in February 2016 was widely regarded as inadequate. Cameron needed to demonstrate to British voters that the EU was capable of reform in response to legitimate concerns about sovereignty, immigration, and the pace of integration. What he got was a package of concessions so modest that his own side struggled to sell it. The EU's calculation was that Britain would vote to remain regardless, that the risk of departure was manageable, and that offering significant concessions would set a dangerous precedent for other member states.

This calculation was wrong.

After the vote, the EU's negotiating posture was designed primarily to demonstrate that leaving the EU must be painful - pour encourager les autres. The integrity of the single market was treated as a principle that could never bend, even when bending would have served the interests of both parties. The result was a withdrawal agreement that satisfied nobody and a trading relationship that created friction where none had existed.

The deepest irony is that many of the concerns that animated the Leave vote - democratic accountability, sovereignty, the pace of integration, the distance between Brussels and ordinary citizens - are the same concerns that Irish voters expressed when they rejected Nice and Lisbon. The difference is that Britain is not a small country that can be asked to vote again.

The View from Beyond

The EU projects itself internationally as a model of multilateral cooperation, human rights, and rules-based order. The rest of the world sees something more complicated.

For the developing world, the EU's agricultural subsidies under the Common Agricultural Policy have historically distorted global food markets, making it harder for farmers in Africa and Asia to compete. The EU has lectured developing nations on free trade while protecting its own agricultural sector with billions in subsidies.

For its eastern neighbours, the EU offers the prospect of membership as a carrot for democratic reform while maintaining accession processes so lengthy and demanding that candidate countries like Turkey, North Macedonia, and Serbia have spent decades in waiting rooms. Ukraine's application for membership, filed during a war, accelerated the rhetoric but not necessarily the timeline.

For the United States, the EU is simultaneously a crucial ally and a frustrating negotiating partner whose regulatory apparatus - from GDPR to digital market regulations - is increasingly seen in Washington as a form of economic protectionism dressed up as consumer protection.

For China, the EU is a market to be accessed and a geopolitical force to be divided. Beijing's strategy of bilateral engagement with individual member states has repeatedly exposed the gap between the EU's aspirations to speak with one voice on foreign policy and its structural inability to do so.

The Democratic Deficit

The phrase "democratic deficit" has been applied to the EU so often that it has lost its force. But the problem it describes has not gone away.

The European Parliament is directly elected, but it cannot initiate legislation - only the European Commission can. The Commission's president is chosen through a process that involves both the Parliament and the European Council, but the mechanism remains opaque to most citizens. Voter turnout in European Parliament elections has been declining for decades, recovering only slightly in recent cycles.

The Council of Ministers, where the real power lies, operates through qualified majority voting on most issues, meaning individual countries can be outvoted on policies that directly affect their citizens. The EU's legislative process involves trilogue negotiations between the Parliament, Council, and Commission that are conducted behind closed doors and are incomprehensible even to most political journalists, let alone ordinary voters.

This matters because democratic legitimacy is not a luxury. It is the foundation on which every other achievement of the European project depends. An institution that cannot explain its decisions to its citizens in language they understand, that treats democratic rejection as an obstacle to be overcome rather than a signal to be heeded, that concentrates decision-making in bodies that most Europeans cannot name, is an institution building on sand.

The Balance Sheet

The European Union has delivered genuine, measurable, historic achievements. It has kept the peace. It has raised living standards. It has created the world's largest single market. It has established environmental and consumer protections that would not exist without it. It has given citizens of small countries opportunities and protections that they could never have achieved alone.

It has also told small countries to vote again when they give the wrong answer. It has forced taxpayers to bail out bondholders. It has created the illusion of competition in sectors where the physical reality does not support it. It has failed to respond adequately to legitimate democratic concerns until those concerns became existential crises. It has built an institutional architecture that prioritises process over accountability and treats democratic consent as an input to be managed rather than a constraint to be respected.

The EU's defenders tend to respond to criticism by pointing to the alternatives - as if the choice is between the EU as it exists and no European cooperation at all. This is a false binary. The question is not whether Europe should cooperate. The question is whether the specific institutional form that cooperation has taken is serving its citizens well, whether it is capable of reform, and whether its leaders possess the humility to recognise when it is not.

On this last point, the evidence is not encouraging. The pattern that emerges from Nice, Lisbon, the bank bailout, Brexit, and the democratic deficit is not a pattern of malice. It is a pattern of institutional certainty - a conviction that the European project is so important, so historically necessary, that dissent must be managed, democratic rejection must be reversed, and the costs of integration must be borne by whoever is too small to resist.

That conviction has produced genuine achievements. But it has also produced a growing distance between the institution and the people it serves. And the history of European institutions that lost touch with their citizens is not a history that ends well.